In 1990, Internet started in Bangladesh with the dial up access. At the beginning, Bangladesh faced many problems in the area of internet browsing and the cost of using Internet was very high for the middle classes people and students.
In 2006, as Bangladesh got itself connected to ‘super speed internet’ through submarine optic fiber connectivity (namely, SEA-ME-WE 4 project), both Cyber Cafes and Internet Service Providers (ISPs) strove to provide internet to end users at a reasonable price.
In those early days, Cyber Cafe was the first choice for students and small business men for internet browsing, sending e-mail or getting important updates on various subjects of interests from the web. According to Bangladesh Telecom Regulatory Commission, there are around 330 licensed cyber café in the country (Financial Express, September 21, 2016).
In present day, however, people can have instant access to internet through mobile handsets as the Mobile Phone Operators allow subscribers to browse internet with very low cost. Cyber Cafe is no longer the only house for internet browsing; instead, there are many mobile Cyber Cafés for students, occasional users and businessmen in the form of mobile handsets and other portable devices with internet access.
City’s cyber café industry, as we have known it, seems to be passing through the last phase in its life-cycle as there has been a major shift from cyber café use to the use of mobile internet and other more convenient, flexible, and time-saving mediums such as tabs, iPod etc. over the last few years.
Many cyber café owners have experienced significant decline in their revenue, the primary reason being the availability of 3G internet on mobile devices as well as Wi-Fi. There has been significant growth in 3G (mobile) internet over the past few years. The number of 3G mobile internet connections rose 60 percent year-on-year to 2.88 crore in fiscal 2015-16 from 0.44 crore in 2013-14. In fiscal 2014-15 the number was 1.8 crore. As of June, 2016, 5.97 crore SIMs had internet connections with 48.28 percent enjoying the fastest data service, according to a draft report of the telecom regulator. With this consistent increase in internet connections, the number of SIM without internet connections is decreasing each year.
Besides, wi-fi service is available in various business establishments (hotels, restaurants etc.) within and across Dhaka city as an additional (free-of-cost) service to the clients. More and more such establishments have been extending the service to their clients for free as one of their promotional tools. Mobile operator Robi recently launched 200 wi-fi hotspots in various establishments – including restaurants, institutes, shopping malls and airports – to ensure uninterrupted indoor network coverage, the initiative being a part of a bigger project under which high speed wi-fi services will be provided in 500 top restaurants and retail outlets, 100 educational institutions, 10 airports and railway stations, and more than 350 buses, taxis and trains.
With this kind of consistent spread in 3G internet and wi-fi, it is no wonder that the people in cyber café business has been losing their market shares and the industry as a whole has been going downhill over a considerable period of time.
Yet another factor that would certainly contribute to the worsening of the already vulnerable situation for the industry is the possibility of considerable improvements in the not-so-good internet data services from the mobile operators and an increase in smart phone penetration in the future. Mobile operators want tax reductions on mobile handset imports so that the penetration becomes deeper. If the government gives heed to their demand, there would surely be a significant rise in smart phone penetration within the country as the prices of handsets decrease in consequence; this, in turn, would help 3G services to flourish further.
Moreover, Chinese telecoms giant Huawei Technologies Ltd. is set to start making smart phones in India sometimes in October, 2016, opening up the possibility of importing low-cost mobile handsets of Huawei brand from India with considerable contribution to a deeper smart phone penetration in the country, given the company’s substantial marketing network within the country that has been spreading.
S.M. Zulfiquer Haider, the president of Cyber Café Owners Association, says that the availability of 3G internet through the mobile devices as well as wi-fi is taking away the market shares of the cyber café owners in the city (Financial Express, Sept. 21, 2016). Significant reduction in profits has forced a considerable number of cyber café to wind up their operations in the capital in the past few years. According to the locals the number of cyber café in city’s Mohammadpur area has been reduced from twenty to only eight within a period of five years (Financial Express, Sept. 21, 2016).
I myself has seen a cyber café disappearing into the oblivion. The cyber café was located in the ground floor of Banani Super Market in Banani. In those days I did not have any internet at home or if I had one it never functioned properly. So, I had no choice, but to visit the cyber café from time to time in case I have a very important mail to send or needed to check my e-mail. It wasn’t a walk in the park to get there as I lived in Gulshan, and the café was in Banani. The name of the cyber café was Speednet Cyber Café, and I got used to visit the café as years went by. Then, one afternoon as I approached the café I could feel that something was not quite right; after a while, standing in front of a vacant space in which the café was located, I saw the space being renovated: the owner opened a woman’s clothing shop after winding up the café; because, he has been losing money in the cyber café business as his profits, which was far from being significant, has been consistently declining, and a shop for woman’s apparel seemed to him a far better option.
Speednet Cyber Café was one of the two cyber cafes in Banani Super Market, the second one being located on second floor of the market. After doing cyber café business for years, it must have been pretty painful and difficult for the owner to relocate investments to an entirely different venture.
One other important thing to note here is the fact that Speednet Cyber Café was located in a convenient place, from which a significant number of private universities were at a stone’s through, let alone the fact that the café was located inside a busy and prominent market place with a considerable crowd (potential customers for the café). If a location like that ultimately fails to attract customers and be reasonably profitable, then it is fair to say that cyber café business in the city is not in a good position; to say the least.
Market for cyber café in Dhaka city is getting smaller and smaller, and the industry insiders expect that the next wave of growth for the business would come from the sub-urban areas, where still exists untapped opportunities for the business. According to sources at the Bangladesh Telecom Regulatory Commission, there are 330 licensed cyber cafes in the country, while 240 such shops are still in line and waiting to get their license. Industry insiders say that most of these applicants are from the suburban region. S.M. Zulfiquer Haider, the president of Cyber Café Owners Association, wants the government to expedite the process of licensing so that the people involved in the business can explore the suburban market.
The association president also believes that a significant change in the business model is the need of the time, expressing his opinion in favor of a model that will offer a more diversified digital services such as scanning and photocopying to stay competitive in the market.
Moreover, the industry insiders identified the high price of bandwidth as a major barrier to spreading internet usage in suburban areas, expressing their opinion in favor of rationalizing the bandwidth price through allowing a few more Nation-wide Telecommunication and Transmission Network (NTTN) service providers, which will create more competition in the sector.
The consistent closing down of cyber cafes in the capital, one after another, over the past few years epitomize a significant shift in the mode of digital communication from stationery to mobile devices. In short, the cyber café business in the capital, in particular, and the industry as a whole seems to be in serious problem, and has been going through a transition period. To help the industry in creating new markets seems to be a possible solution to the industry’s peril. To this end, government should assist creating a favorable environment for investing in cyber café business in the suburban areas, where use of mobile/portable devices such as smartphones, laptops, tabs, iPod etc. that can support 3G internet is still limited, and where there are people with the need for internet browsing, sending e-mail or getting important updates on subjects of their concern.